A new round of steep U.S. auto tariffs has reignited fears that GM Korea could shutter its Bupyeong plant, a move that workers and residents warn would devastate the local economy and echo the fallout from the company’s 2018 exit from Gunsan.
On Apr. 3, hours after former U.S. President Donald Trump imposed sweeping tariffs on imports, GM Korea’s Bupyeong plant in Cheongcheon-dong, Incheon was buzzing with activity.
The factory, covering about 1 million square meters—roughly the size of 136 soccer fields—was surrounded by a steady stream of employees and trucks. But anxiety ran just beneath the surface. Workers spoke with concern about the tariffs, while residents worried that GM Korea might not withstand the blow and could eventually shut its doors.
The new tariff—25% on all imported vehicles—took effect at 1:01 p.m. that day. GM Korea exports more than 80% of its vehicles to the United States, meaning the added costs could wipe out price competitiveness and undermine the case for continuing production in S. Korea.
On the outside, the plant appeared to be running as usual. Two tall chimneys behind the front gate kept emitting white smoke and steam, and newly assembled vehicles were being loaded onto large transport trucks headed out of the facility.
“Just today, 870 vehicles rolled out of the plant,” said Choi, 55, a security guard stationed at the entrance. “Most are for export and head straight to Incheon Port.”
Another employee walking in said the production schedule had already changed: “Since this year, we’ve stopped working on national holidays. Until last year—before talk of tariffs—we ran 365 days a year. Now output is down, and everyone feels uneasy.”
A worker leaving through the west gate explained that the factory is split into production and development divisions. “Production’s been on edge since the end of last year,” he said. “But R&D still feels relatively calm for now.”
An employee with a partner firm, wearing a work uniform and safety helmet, said that if GM Korea were to leave, he would need to start job-hunting.
“I do get assigned to other locations, but GM Korea is my main client. If they go, my job disappears. There are five or six electrical contractors like us, but many more companies doing construction and facility work. The impact would be massive.”
At lunchtime, workers poured into the row of restaurants just outside the plant’s west gate. Kim, 36, who runs a barbecue joint nearby, said, “We rely on lunch, of course, but dinner gatherings—those big team meals where people spend hundreds of dollars at once—really help us stay afloat. If GM pulls out, we’ll be hit hard.”
He added, “Some people say another company will take GM’s place, but this could turn out like Gunsan. Even if they build a shopping mall, it wouldn’t help us much.”
General Motors acquired Daewoo Motors in 2002 and changed its name to GM Korea in 2011. In 2018, the company shuttered its Gunsan plant but agreed to keep operations in South Korea through 2027 in exchange for a 810 billion won ($554.9 million) government aid package. At the time, analysts estimated that roughly 25% of Gunsan’s population was affected by the closure.
Local governments and GM Korea’s suppliers have already begun taking stock of the situation. The Incheon city government said, “There are 47 tier-one suppliers for GM Korea in Incheon alone. Nothing has been decided yet, but we may need to support them—so we’re in the process of assessing the situation.”.
Including tier-two and tier-three suppliers from other regions, GM Korea is estimated to work with roughly 3,000 partner firms. A nearby financial institution said, “GM Korea alone has over $342.5 million deposited with us. That number is even higher if you count other banks.”
Residents say they hope GM stays put. Jung Hyun-il, 37, who works for a nearby public agency, said, “GM Korea owns a huge site and works with countless suppliers. It wouldn’t be an exaggeration to say it makes up half of Bupyeong. We need them to keep going.”
Lee, a 70-year-old taxi driver, said, “If you count employees, partners and their families, you’re talking tens of thousands of people. If GM leaves, the blow wouldn’t stop at Bupyeong or Incheon—it would ripple through the entire national economy.”
Lee Ho-geun, a professor of automotive studies at Daedeok College, said, “GM has repeatedly used the threat of withdrawal to pressure the government for support over the past eight years. It’s highly possible they’ll use the tariffs as another reason to pull out.”
He continued, “The auto industry has vast forward and backward linkages. GM exports around 350,000 vehicles from S. Korea. From the workers’ point of view, accepting wage cuts to offset tariffs might be the only reasonable and viable choice.”
